'Red fire' securities and banking case back at Taiwan High Court

TAIPEI, Taiwan -- The Supreme Court yesterday abrogated the original judgment of Jeffrey Koo Jr.'s (辜仲亮) involvement in the "Red Fire case," returning the case to the Taiwan High Court.

The former vice chairman of Chinatrust Financial Holding Co. (CFH) had been sentenced to nine years and eight months in prison after the Taiwan High Court found him guilty of violating securities and banking laws in a multi-million dollar transaction in June 2013.

The financier was found guilty in what has come to be called the "Red Fire Case," in which he is said to have made more than NT$1 billion in undue profits in a transaction of structured notes linked to Mega Financial Holding (兆豐證券) in the early 2000s.

According to the verdict, Koo and some other senior executives from his company masterminded the illegal and false financial transaction through a paper company, Red Fire Developments; they set up in Hong Kong and caused losses for Chinatrust Financial.

According to a statement released by Chinatrust yesterday, the company has reaped a profit of NT$1.7 billion from the Red Fire case and another NT$11.2 billion from its investment in Mega Financial Holding, therefore Chinatrust Financial did not suffer losses in either case.

The statement also noted that after an investigation within the company, it can be affirmed that Koo and three other senior executives did not receive any private benefits because of the said cases.